CLEVELAND (AP) -- A northeastern Ohio man was sentenced Tuesday to 25 years in federal prison for obtaining nearly $11 million in fraudulent loans that authorities said helped cause one of the biggest credit union failures in U.S. history.
A jury found Gezim Selgjekaj, 44, of Avon Lake, guilty in February of 27 counts that included conspiracy, bank fraud, bribery and money laundering. Selgjekaj was accused of obtaining the loans from St. Paul Croatian Federal Credit Union in Eastlake between 2003 and 2010, including some during the four years he spent in prison for tax evasion.
Federal prosecutors said most of loan money was never repaid. Regulators liquidated the credit union in 2010, resulting in a $170 million loss to the National Credit Union Share Insurance Fund.
Selgjekaj's federal public defenders said Tuesday they were outraged that their client would be penalized so harshly after invoking his right to have his case heard at trial while others who had played bigger roles in the institution's collapse got considerably shorter sentences by agreeing to cooperate.
More than two dozen people have been convicted of federal crimes in connection with credit union's failure. The U.S. attorney in Cleveland said in a statement that Selgjekaj "abused the trust" of credit union members.
Defense attorney Edward Bryan questioned why the chief operating officer of the credit union, whom he called the architect of the collapse, received only 14 years in prison at his sentencing in November 2012. Bryan pointed out that while Selgjekaj was ordered to pay $16 million in restitution, the judge ordered Anthony Raguz to pay $71 million. It was Raguz who ultimately controlled who got the loans that led to the credit union's failure, Bryan said.
Raguz testified at Selgjekaj's trial that he took bribes from numerous people who received loans. Prosecutors said Selgjekaj paid $200,000 in bribes to Raguz.
"Anyone who asked got loans from the credit union," Bryan said, referring to Raguz's management.
Selgjekaj used loan proceeds to start businesses that provided jobs, Bryan said.
"It wasn't like he got credit union loan proceeds and frittered them away," said Selgjekaj's other attorney, Caroline Kucharski.
The attorneys said Selgjekaj repaid the credit union between $400,000 and $500,000 of the $10.6 million lent to him.
Selgjekaj has lived in the U.S. under a grant of political asylum after fleeing his native Albania in the early 1990s, his attorneys said.